BJ
BJ's Wholesale Club Holdings, Inc.
$99.04
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Overvalued
Trading 41.3% above fair value
You pay
$99.04
Bear
$61.32
Fair
$70.08
Bull
$78.84
Bear
$61.32
-38.1%
$4.38 × 14x P/E
Fair
$70.08
-29.2%
$4.38 × 16x P/E
Bull
$78.84
-20.4%
$4.38 × 18x P/E
Adjust Assumptions
16.0x
4.38$
Key Value Driver
Normalized P/E multiple (16x base case)
Implied Market Multiple
22.6x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (27 analysts)
$111.50
Divergence from AlphaVal
37%
Summary
Applying a 16x P/E to adjusted EPS of $4.38, the base-case value is $70.08 per share.
Warnings
Wall Street's average price target is $111.50 (from 27 analysts). Our estimate is 37% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples